Billing Irregularities
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This article is written by Mohammed. Irshad, a 4th-year student of BA LLB in National Law University, Kochi. The article discusses on the topic of primal concern i.e., Electricity Theft. 

Introduction

Electricity theft is indeed a growing problem across the world. The theft is predominantly prominent in under-developed countries and developing countries, particularly in many African and South Asian countries. Electricity theft is an alarming problem in most developing countries and every year; this has been a loss of billions of dollars. And ultimately it is affecting the consumers who legally use the power energy. It is they who bear the loss at the end, and it also vigorous disturbs social justice as well. Further, it affects the investment decision and hampers economic growth and thereby the future of nations as well. 

Different Modes Of Electricity Theft

Given below are the most prominent Four kinds of “theft” in almost every country, including India.

Billing Irregularities

Billing irregularities are the most commonly found electricity theft in India; it can be either intentional or unintentional. What generally happens in an intentional irregularity is that the billing authority would take some menial amount as a bribe and record the meter at a lower number than what it is shown in real life. The Unintentional irregularities range from ineffective measuring mechanism to substandard staff, which ultimately results in a large loss unintentionally. 

Unpaid Bills 

Some people and organizations do not pay what they owe for electricity. Residential or business consumers may have left the city, or an enterprise has gone bankrupt.

Fraud

Fraud happens especially when the consumer deliberately tries to deceive the Utility. The commonly seen practice is tampering the meter so as to lower the reading from what they have actually used. A consumer with little technical knowledge can easily tamper the low equipped fragile meters.

Stealing Electricity

Another mode of Electricity theft is stealing electricity. This is mainly done by rigging a line from the power source to a meter (where it needed bypassing). The wires such as Diablitos or Little devils are used by many illegal customers to steal electricity from the nearby Electric posts which in fact push an overburdened electrical grid over the edge. 

Direct Connection from the Pole 

This is the most predominant method of electricity theft and the easiest way of doing it. Since the meters and other equipment in this section are in the 220 V mechanism and where consumers are mostly houses and small businesses, a direct connection from the pole is much easier than the high-voltage system. What all is needed is just a pair of rubber gloves, a knife, and a ladder. 

Some of the Technical Methods

Remote

They are peculiar remotes available in markets which slow down the meter speed. The remotes are largely made in China. 

Phase-to-phase connection

The phase-to-phase connection is another method. This is more or less similar to that of using an alternate neutral line, but in this case, the system voltage will become the phase to phase voltage at 240 or 380 volts.

Using alternate neutral lines 

What happens, in this case, is that a person would use a small transformer to use it as an alternate neutral line hence the meter which uses the same sought of the neutral source will automatically read the incoming voltage at a comparative lower pace. This results in showing reduced unit count. One important factor which stimulates the theft by using alternate neutral line is the fragility of the single-phase system, which often has only one wire going into a house, i.e. “hotline. And neutral is usually grounded (electrically connected to the earth) and at times is provided by the foundation of the house to be more generic. 

Meter tampering/breaking seal 

This is essentially the same as that of what happens to the HV meters. Other methods of electricity theft include: Tapping off a nearby paying consumer, damage done to meter enclosures, and using magnets to slow down the spinning discs in the meter housing.

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General Concerns And Impact On Economy 

The wordings of the International Energy Agency are worth noting in this regard. It said,

“Thousands of homes and businesses have been hit with power outages that electric company officials blame largely on pirates. The illegal lines are easy to detect as they are often above ground and highly visible. However, one finds reports of staff being assaulted and needing police security to carry out the removal of the lines. Corrupt staff from the electricity organization may take bribes to allow the practice to continue. On a larger scale, businesses may bribe power organization staff to rig direct lines to their buildings or offices and the power does not go through a meter. Bribes can be much less than the cost of power. Money also can be given to inspectors to keep them from finding and/or reporting the theft.”

In short, the concerns are not limited to a particular area as such; the electricity theft occurs due to various factors; few are mentioned here. Whatever form it might be, it ultimately affects the economy.

It is necessary to understand that from a business perspective, electricity theft results in economic losses to the Utility of an economy. The combined losses as a result of electricity theft, whichever form it might be including non-payment of bills have a severe impact on the economy.

Concerns In India

It is important to note that the electricity supply in India is not a commodity that is taken for granted by consumers. We should acknowledge the fact that power is absolutely valuable to Indians, that is why there have been many brutal attacks on Inspectors from electric companies so as to avoid paying their electricity bills. Another fact which we should acknowledge is the widespread tampering with the meters so as to lower the reading and thereby to circumvent the payment of a higher amount. According to Bloomberg estimates there was an annual loss of $ 17 billion revenue loss annually due to electricity theft alone, this figure itself connotes to the menacing effect of electricity theft on the economy as such.

We should relate the basic problem of scarcity here, i.e. “resources are limited, and needs are unlimited”. Relating the same concept to our scenario, we should always keep in mind that electrical energy is an energy which is limited and the need of people is unlimited so conserving the same should be a primal concern. If we analyze the common practice of electricity theft, we should accept that most of the theft is happening in the process of transmission and distribution. Today our society as such is undergoing a huge problem corresponding to power theft. The ways people are committing thefts are such as they either attach magnets in case of electromagnetic energy meter or might attach a simple circuit generating electromagnetic rays which would stop regular working of electronic energy meter. Moreover, people even try to breach the energy meter seals for making various circuited connections that will help them to reduce their electricity bills. 

When we trace the history of law governing the Electricity sector before Electricity Act 2003, it was The Indian Electricity Act 1910 and further the Electricity (Supply) Act, 1948 and the Electricity Regulatory Commission Act, 1998. 

Offences And Penalties

The Electricity Act 2003 extensively deals with various aspects of electricity regulation in India. The Electricity Act essentially aims at prevention of Electricity theft at any cost. It is treated as an offence which attracts both fine and Imprisonment. Part XIV of the Electricity Act 2003 deals with the offences and penalties under the Act. This chapter contains 15 Sections from 135 to 150. 

Section 135 of the Act defines Electricity Theft. The section treats any dishonest taping of electricity, tampering of a meter in any manner, using the current reversing transformer, damaging the meter or wire so as to interfere with the proper accurate reading of usage of electricity etc. as electricity theft. This section is an elaborate section which categorically states the various forms of electricity theft, but only a few of them are stated here. What all is needed to make a person liable under Section 135 is that he should act “dishonestly” which means there should be men’s rea (Guilty mind) to attract the liability for electricity theft. Further, there should be a physical act as elaborated under the section. If both elements are satisfied, one can be made liable for electricity theft.

And the punishment is prescribed based on the basis of the amount of load and subsequent offence. For less than 10 kilowatts the first conviction shall not be less than three times the financial gain on account of such theft of electricity and in the event of a second or subsequent conviction the fine imposed shall not be less than six times the financial gain on account of such theft of electricity. And if the amount exceeds 10 kilowatts the fine imposed on first conviction shall not be less than three times the financial gain on account of such theft of electricity and in the event of a second or subsequent conviction, the sentence should be Imprisonment for a term not less than six months, but which may extend to five years and with fine not less than six times the financial gain on account of such theft of electricity:

Further Section 136 punishes one who cuts away electric lines and material for wrongful gain and convenience. The section treats this as an offence punishable for a term which may extend to 3 years with fine or both. And the subsequence offender shall be punished for not less than 6 months but which may extend to 5 years.

Further Section 138 deals with unauthorized interference with meters or works of the licensee so as to wrongful loss to the government. The offender under the section shall be punishable with Imprisonment which may extend to 3 years or with fine not exceeding Rs 10000. And in case of continuing offence daily fine extending Rs 500.

Subsequently, the other few sections of chapter xiv deal with various offences like Malicious wasting electricity, extinguishing public lamps, negligent waste of electricity or injuring works etc. 

Cognizance

Section 151 deals with cognizance of an offence punishable under the Act. The cognizance of an offence punishable under the Act can only be taken upon a complaint in writing made by:

  • Appropriate Commission
  • Any of the authorized officer 
  • Chief Electrical Inspector or Electrical Inspector 
  • Licensee 
  • Generating Company

Another peculiar thing to be noted here is that the special court constituted under Section 153 of the Act is also competent to take cognizance of an offence under the Act without the accused being committed to it for the trail. It also provided that the court may also take cognizance of an offence punishable under the Act upon a report of a police officer (commonly named as charge sheet) filed under Section 173 of the Crpc.

Deen Dayal Upadhaya Gram Jyoti Yojana (DDUGJY)

It is very important to know DDUGJY in the context of electricity spectrum in India. It is a very new initiative taken by the Government of India in 2015. The very reason to initiate such a scheme was based on some future concerns such as the increase in demand of power, the archaic traditional method followed for power generation etc. And the scheme aims at changing the approach towards electricity in every respect. The primary focus of this scheme is to spread the benefit of electricity to every household in the country and the sub-transmission and distribution of electricity in rural areas. It also has many other aims including building effective metering system so as to reduce the power losses, ensuring uninterrupted power supply in schools, hospitals, panchayat etc.

And ultimately all the endeavours under the scheme can be related to reducing the power theft in India. Since the basic reason for power theft in our country is the scarcity and availability of electricity. And this scheme intrinsically focuses on solving the said problem. 

Conclusion

It is rudimentary to understand that power theft is a major area of concern to date, and there is a pressing need for a pragmatic solution for the same. The schemes Like Deendayal Upadhyaya Gram Jyoti Yojana will have an important role to play in this respect. Indeed, we should acknowledge that there are enough laws and regulations to protect the electricity sector and the crimes committed therein, so what is needed is a proper implementation mechanism for the already existing laws. The scheme, including DDUGJY, is not properly implemented, there have been many lacunas in the implementation process. 

References

  1. Smith, ‘Electricity Theft As A Relational Issue: A Comparative Look At Zanzibar, Tanzania, And The Sunderban Islands’ [2012] 16(1) Journal On Energy For Sustainable Development 2071
  2. Malka Tarannu And Others, ‘Electricity Theft In India: Its Measure And Solution’ [2017] 3(5) International Journal Of Advance Research, Ideas And Innovations In Technology 406-409
  3. Ahmad, Sanaullah, ‘Detecting And Minimizing Electricity Theft: A Review’ [2015] 1(1) Journal Of Emerging Trends In Applied Engineering Er
  4. J. B. Gupta, “Electrical Power System Volume 3” S.K.Kataria & Sons. Second Edition. January 2004.
  5. P. N Khare MSEB, Power Theft – A Root Cause of T& D Losses
  6. Https://Www.Iea.Org/
  7. Scc Online
  8. The Electricity Act, 2003
  9. https://www.bankbazaar.com/saving-schemes/deen-dayal-upadhyaya-gram-jyoti-yojana.html

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